Ottawa

Busing costs drive school boards deep into deficit

Two eastern Ontario school boards say students could suffer if the province doesn't help them absorb a sudden increase in transportation costs forced on them by recent arbitration.

2 eastern Ontario boards owe millions following arbitrator's ruling

Two eastern Ontario school boards say they're being driven into deficit because of unexpected increases in student transportation costs forced on them by an arbitrator's decision. (Robyn Miller/CBC)

Two eastern Ontario school boards say students could suffer if the province doesn't help absorb a sudden increase in transportation costs forced on them by recent arbitration.

The Upper Canada District School Board (UCDSB) and Catholic District School Board of Eastern Ontario (CDSBEO) are each facing huge deficits for 2017-2018.

The impact on students could be very real.- John McAllister, UCDSB chair

The UCDSB overspent its transportation budget last school year by $9.5 million, while the CDSBEO overspent by $5.8 million.

"We are in crisis mode right now," said UCDSB chair John McAllister, who said the board is now facing an annual increase of $10 million to transport students. The CDSBEO's future cost increase isn't known.

On top of that, the two boards are facing a combined bill of about $30 million in retroactive payments, all thanks to an arbitrator's ruling.

Upper Canada District School Board chair John McAllister said the board is in 'crisis mode.' (Robyn Miller/CBC)

"I mean we just don't know how we're going to do this without cutting programming or reducing transportation," McAllister said. "In other words, the impact on students could be very real."

The UCDSB covers an area the size of Prince Edward Island, transporting 20,000 of its 27,000 students by bus.

John McAllister, chair of the Upper Canada District School Board, says students could suffer if the province doesn't help the board cover a $10 million increase in the annual cost of transportation. 0:35

Arbitration drove costs up

The sudden hike in transportation costs began with a lawsuit launched in 2012 by a group of bus companies. 

The companies were upset with the province for enacting the Broader Public Service Procurement Directive, which forced school boards to open transportation contracts to competitive bidding, but ultimately forced many smaller operators out of business.

An injunction was ordered and the province instructed Student Transportation of Eastern Ontario (STEO) not to adjust its rates, stalling annual increases.

An arbitrator brought in this year to resolve the issue ordered the increases reinstated, plus retroactive payments.

Frank Healey, who owns Healey Transportation Ltd. in Smiths Falls, Ont., said the bus operators simply couldn't continue without seeking arbitration.

Frank Healey has been in the bus business for about 40 years. He says the arbitration order that's driving the increase in costs represents years of adjustment all at once. (Robyn Miller/CBC)

"It is a dramatic increase because it represents eight or nine, perhaps even 10 years of adjustment all at once for them," said Healey, who is also president of the Independent School Bus Operators Association.

"It has hit those school boards dramatically, and I know it's impacted their budgets very negatively."

In the case of the CDSBEO, the ruling has suddenly thrust its budget well into the red. 

"Prior to the arbitration award being granted, the CDSBEO would have presented a compliant budget for 2017-2018 with a surplus of over $3.57 million," said Bonnie Norton, the board's associate director of education and treasurer.

Help from province

The Ministry of Education said it's aware of the concerns of the UCDSB and CDSBEO, and is working to "find solutions to ensure the sustainability of student transportation and education."

The ministry said it's providing school boards in Ontario with a projected $961.4 million for student transportation, and said the boards are responsible for allocating that money to meet local needs and priorities.

McAllister said the two boards have been in communication with elected officials and are hoping to set up a meeting with the education minister to discuss the need for more funding to balance the books.

"We may have to take a good look at all facets of our operation and reduce — reduce service to parents and reduce service to students," said McAllister.

The board begins next year's budget process in January.

An increase in costs for yellow school buses has put the Upper Canada District School board in the red. And now the school board is grappling with how to make-up for nearly 10-million dollars in overspending. 7:10